A New White Paper Analyzing the Recent Medicaid Modernization Effort in Louisiana Suggests Substantial Cost Savings for North Carolina.
A new white paper released by the NC Medicaid Choice Coalition illustrates that North Carolina could reduce Medicaid costs by $1.2 billion dollars over the two-year budget window by implementing a reform proposal that includes traditional managed care. The assumptions are based on Louisiana’s recent Medicaid reform effort and would translate to $325 million in state savings over two years.
“The results of Louisiana’s Medicaid reform demonstrates the potential for substantial cost savings and improved quality of care when modernization includes managed care,” stated Taylor Griffin, spokesman for the NC Medicaid Choice coalition.
North Carolina’s Medicaid program cost $13.3 billion last year, of which $3.4 billion was paid by North Carolina taxpayers. Despite the state’s large investment in Medicaid, North Carolina taxpayers still aren’t getting the value they deserve.
“As the General Assembly prepares to debate the topic of Medicaid reform, it needs to use a proven approach that includes managed care. With inclusion of managed care, reform can be implemented quickly and allow the state greater flexibility to ensure budget predictability and improvements in care,” Griffin stated. “Every year we wait to implement reform costs millions of dollars in unrealized savings that could be used for teacher salaries, infrastructure, and economic development initiatives.”
North Carolina is one of the few states that still relies on an outdated fee-for-service Medicaid system that pays doctors primarily for the volume of services they provide rather than for quality of care and improved health outcomes for patients. Currently, 39 states have adopted Medicaid reforms that shift financial risk away from taxpayers to managed care organizations. These organizations are paid a fixed fee set by the state to support the health care needs of Medicaid recipients and are accountable for meeting quality and other performance measures.